Ford’s U.S. auto sales rose 16% in the third quarter, but fell in September due to supply issues

Ford said its third-quarter sales rose about 16% from the same period last year, even after a sales slump in September. Company vehicle sales were down about 4% from the second quarter.

Ford said it sold 142,644 vehicles in September, down 8.9% from September 2021. The drop caused the company to miss quarterly sales expectations from Cox Automotive and Edmunds, which had forecast gains of 19% and 17.8%, respectively.

According to Andrew Frick, vice president of sales, distribution and trucks at Ford, demand for new vehicles “remains strong” and retail orders are “increasing rapidly.” The company’s quarterly sales outperformed the industry, which analysts had expected to fall just under 1% from a year ago.

Last month, Cox Automotive lowered its new vehicle sales forecast for 2022 to 13.7 million, down 9% from 2021 and the lowest sales volume forecast in a decade. Ford has sold more than 1.38 million units year-to-date through September, down 1.2%.

The company said sales of its F-Series pickups were down 27% in September from a year ago. However, sales of Ford’s Mustang Mach-E crossovers are up 49% from 2021, accounting for about two-thirds of the company’s 41,200 total electric vehicle sales.

The company’s quarterly sales topped many others in the industry. In light of the news, Morgan Stanley analyst Adam Jones moved the automaker’s stock to an overweight from equal weight and maintained its price target of $14 per share.

Ford shares fell more than 18.5% through September after the company said its supplier costs would be $1 billion higher than expected in the third quarter and told investors that approximately 40,000 to 45,000 vehicles had not been delivered to dealerships due to parts shortages.

“The Q3 earnings warning coupled with macro concerns led to lower corn-side expectations and a sharp decline in equities,” Jonas wrote. “Ford shares are trading around 8 times our normalized EPS forecast of $1.50.”

“A potentially favorable idiosyncratic development regarding corporate restructuring (creation of Ford Blue and Ford Model e) has the potential to better align the growth and investment (capital expenditure) needs of the EV business with a more favorable cost of capital,” Jonas said.

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Sallie R. Loera